The Brandtech Group acquires Singapore-based AI ad generator Pencil

The Brandtech Group has acquired Singapore-based artificial intelligence platform Pencil, which generates ads for brands that it has calculated as most likely to achieve their desired outcomes.

Financial terms of the deal were not disclosed. Pencil has raised $3.9 million in funding since it was founded in 2018, according to Crunchbase.

The deal comes just weeks after the advertising group completed its acquisition of digital agency Jellyfish.

A team within Jellyfish has been tasked with training 1,000 of the Brandtech Group’s employees in generative AI so they can tap into Pencil’s offering.

Pencil is one of a growing list of generative AI products that offers to take out much of the heavy lifting of ad creation — similar offerings have been launched by tech giants Meta and Google in the past month. 

Pencil’s technology is built on OpenAI’s GPT family of large language models (LLMs).

The platform ingests brand assets including logos, product descriptions and colors and returns a selection of ads. Each ad is scored based on how likely it is to achieve a desired outcome (awareness, conversion or traffic), targeting type (acquisition, retargeting, retention) and metric (ROAS, CPM etc). It says its predictions are built from more than $1 billion of actual media spend data across 4,000 brands from the past five years.

The captions, images and videos generated by Pencil are all editable within the platform. Integrations with platforms like Facebook and Instagram enable advertisers to launch ads directly from the platform and swap out ads that are underperforming.

Pencil claims to have generated more than one million creative executions for brands in the past year.

The company was founded by Singapore-based advertising and technical duo Will Hanschell and Sumukh Avadhani. Hanschell was previously a director at Iris Worldwide’s consulting and data business, Concise, in Singapore. Avadhani, who is chief technology officer, comes from an engineering background with experience at firms including Google and Toshiba.

The Brandtech Group has been working with the Pencil team over the past six months to build an enterprise solution for global brands that includes a broader range of integrations as well as the ability to ring fence data.

Called Pencil Pro, the solution includes AI integrations with Stable Diffusion, Runway and OpenAI’s GPT-4 and ChatGPT as well as media integrations with TikTok, YouTube, Google Display and Amazon Ads.

The solution also purports to mitigate the “legal headaches” of generative AI for brands by securing client data in separate AI models.

"Client data is ring fenced in Pencil Pro, so that enterprise clients benefit from the billion dollar sector-level data set Pencil has and their own data for predictive performance. To do that, we train a model just for them using both data sets — and therefore their owned data is secure and none of their competitors benefit,” Rebecca Sykes, emerging tech lead at the Brandtech Group, told Campaign.

Unilever and Bayer have been secured as launch partners.

Pencil marks the Brandtech Group’s tenth acquisition since it was formed by former Havas CEO David Jones in 2015.